Krusty is told by his accountant that unless he stops placing risky gambling bets he will go broke. Krusty refuses to alter his lifestyle, opting instead to raise more money by founding a clown college to franchise his image. Homer sees a billboard advertising the college and becomes obsessed with enrolling. After learning the secrets of the trade, taught by the master himself, Homer successfully graduates... though he never successfully masters the trick of riding a miniature bicycle through a loop.

Homer is soon appearing as Krusty at events throughout Springfield. His second job comes with a price, however, and Homer finds himself run ragged by the grueling schedule. He grows depressed that being a clown is not as much fun as he thought, and contemplates throwing in the towel. But when Chief Wiggum tears up a speeding ticket because he thinks Homer is the real Krusty, it gives Homer an idea. He soon has people all over Springfield believing that he is the genuine article, and takes advantage of the perks the real Krusty has always enjoyed. Meanwhile, gangster Fat Tony calls on Krusty and demands that the clown pay up his gambling debts. Krusty beats a hasty retreat and the gangsters embark on a search to capture him. Unfortunately for Homer, Fat Tony and his gang mistake him for the real Krusty.

The gangsters ignore Homer when he tries convincing them who he really is. The leader of the gang, Don Vittorio, tells Homer he will spare his life if he performs the classic bicycle-through-the-loop trick. Just as Homer’s disastrous attempt fails, the real Krusty races into the room. Don Vittorio tells Homer and Krusty he will spare their lives if they complete the loop while riding the same bicycle. The pair fail miserably, crashing into a bar, but the momentum propels them back out into the loop, allowing them to complete the trick. Don Vittorio spares their lives.